Equipment

Your equipment can be listed as a separate items on your business or farm insurance policy. It can also be grouped together under a blanket which will have a specified limit.

Equipment usually has co-insurance and so it is important to list an accurate replacement value. If you fail to insure for the full amount and you have a claim then you will be penalized for the amount you failed to insure. After the penalty is deducted then your deductible will be taken away and you will get the remainder.

Many companies class equipment as being items that are $1,000 in value or cannot be held in the hand. Items of lesser amounts and that are hand held are usually classed as tools.

The rate for equipment is often less then tools as the risk for tools is higher. You can steal and dispose of tools more readily than equipment.

A contractor who relies on certain high-valued equipment to conduct his daily business needs to consider equipment rental reimbursement so that if his equipment is stolen or damaged by an insured peril he will be able to continue to work. When considering this option bear in mind that the equipment must be available to rent. The rental coverage does not start until you have actually started renting the equipment - it is not a business income replacement coverage.

It is important that you discuss your operation with your agent or broker. It is wise to have an inventory of your tools and equipment.